Overview
- Tiger Global lost its appeal as a bench of Justices J B Pardiwala and R. Mahadevan set aside the Delhi High Court’s August 2024 order that had favored the investor.
- The court held capital gains from the 2018 $1.6 billion Flipkart stake sale taxable in India, ruling that the Mauritius-based structure lacked commercial substance and that a Tax Residency Certificate is not conclusive.
- Authorities are preparing recovery steps including resuming assessments for AY 2019–20, issuing demand notices, and adjusting amounts previously withheld during the transaction.
- Estimated exposure in the case is reported around Rs 14,500–15,000 crore, with the ruling expected to guide enforcement in similar treaty‑routing disputes.
- The decision underscores ‘substance over form’, clarifies that GAAR can deny treaty relief despite grandfathering claims, and is prompting foreign investors to reassess holding and exit structures routed via Mauritius and Singapore.